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Financial Analysis of Starbucks

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Starbucks Financial Analysis

Table of Contents
History 3
Overview 3
Strategy 3
S.W.O.T. 4
Starbucks Ratios 5 Balance Sheet Analysis 5 Profitability Ratios 8 Activity Ratios 9 Investment Returns 9
Comparative Analysis 10 Profitability 10 Management Effectiveness 10 Valuation Measures 10 Share statistics 10 Stock Price History 11 Dividends & Splits 11 Balance Sheet Ratios 11 Conclusion 11
References 12 Electronic Sources 12 Bibliographic Sources 12
Appendix 13


The first Starbucks affiliate opened in 1971 in Seattle. The company focused on selling roasted gourmet coffee beans and coffee accessories. The name originates from a character in the novel Moby Dick from Herman Melville. In 1982 Howard Schultz joined the foundation-team of Jerry Baldwin, Zev Siegel and Gordon Bowker as the Director of Retail Operations and Marketing. Inspired by his personal experiences of Italy´s coffee tradition, Schultz proposed to change the company´s strategy and create a coffee chain where customers enjoy their coffee and meet friends. His idea was to transform the coffee shop to be a central meeting and socializing point. As Schultz was not able to convince the founders to switch the company into a concept coffee shop he started his own coffee shop, Il Giornale. Due to his success with his own coffee shop and the support of local investors, he was able to acquire Starbucks in 1987 from its founders.
Schultz overtook the name and started a progressive expansion. Within five years Starbucks was listed in NASDAQ.

Nowadays Starbucks is an upmarket coffee shop chain. With more than 18.000 retail stores in more than 60 countries and more than 170.000 employees worldwide, Starbucks is the biggest coffee retailer in the world (numbers from July 1st, 2012). The product range includes coffee, handcrafted beverages, fresh food,...

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